Tuesday, January 16, 2007

Watching The Price Of Oil

By Tony Sayegh

The price of crude oil could be one of the indicators as to the timing of the expansion of the war and an attack on Iran. As I write this, the price has dropped below $51 per barrel. People had expected that as evidence accumulates that an attack on Iran could be imminent, the price would rise instead. What gives? Enter Saudi Arabia and Dick Cheney.

Dick Cheney with his oil background was responsible for the oil price increase for the past year and a half. One factor was the increased demand to fill the strategic reserves in the U.S., Europe, Japan and China to capacity. Now these reserves are full to ensure adequate oil supplies after the loss of Iranian production. Dick Cheney knew that the biggest problem he would face when he expands the war is the U.S. taxpayer who is tapped out. However, due to the price increase the revenues of Saudi Arabia and other oil-producing Arab puppets increased tremendously. Some of that windfall will finance the war on Iran. You can look at it this way: The U.S. taxpayer is still paying for it, but at the pump. That money is now sitting in Saudi banks waiting for Dick Cheney to use to finance the war on Iran.

A few days ago Hugo Chavez and Ahmadinejad called for OPEC to cut production to support falling prices; today Saudi Arabia said no. Actually Cheney’s plan is for Saudi Arabia to max out its production and to break the oil price, with a target price around $30 per barrel. This would make Americans happy with lower gasoline and heating oil prices, but more importantly it would reduce the income to Iran and Venezuela.

If the U.S., through the deployment of Patriot missiles and the U.S. Navy, can protect the Saudi oil facilities and keep the Strait of Hormuz open, oil prices instead of zooming to $200 a barrel, might fall to $30. As they say expect the unexpected.